Olympic fever. As the world's premiere athletes compete in London -- the presidential campaign here keeps its fierce pace, with doubts on the economy.

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ROMNEY: The president has not had policies that put American families back to work.

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STEPHANOPOULOS: Tax plans.

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OBAMA: He's asking you to pay more so the people like him can get a big tax cut.

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STEPHANOPOULOS: And tax returns.

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ROMNEY: Harry Reid really has to put up or shut up, all right? So, Harry, who are your sources?

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STEPHANOPOULOS: The big questions, was Friday's jobs report a sign of hope or more of the same? Will Mitt Romney's failure to release more tax returns trump the president's failure to create more jobs? And how much of a splash can Romney make with his running mate?

We'll ask the party chairs. Debbie Wasserman Schultz for the Democrats, Reince Priebus for the GOP. And our powerhouse roundtable, with George Will, Ann Coulter, Van Jones, Steve Rattner and Jonathan Karl.

Plus, ABC News at the Olympics. All the latest from London.

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STEPHANOPOULOS: Hello again, and how about that Michael Phelps? What a stunning capper to his Olympic career last night, 18th gold medal, sealing his place as the top Olympian ever. We're going to have more on that coming up.

But politics first, and a face-off with the party chairs after a surprisingly packed first week of August. Debbie Wasserman Schultz here for the Democrats, Reince Priebus for the Republicans.

And Congresswoman Schultz, let me begin with you and begin with that unemployment report that came out on Friday. The good news, 163,000 jobs created. The bad news, unemployment up to 8.3 percent. That makes 42 straight months of unemployment above 8 percent. No president since FDR has been elected with numbers even close to that, so how do you respond to Americans who say that 8 percent unemployment just isn't good enough?

SCHULTZ: Well, we know that we need to keep pressing forward and continue to fight for new jobs and getting this economy turned around. But what we do also know is that we have had 27 straight months of job growth now in the private sector. This month, that Friday's job report, 172,000 new private-sector jobs were created. We have had a surge in the growth of the manufacturing sector. More than 500,000 jobs created in manufacturing. That's the first time that we have seen job growth in manufacturing, George, since the 1990s.

We're moving in the right direction, and the president has proposed the American Jobs Act. It would be great if my colleagues on the Republican side in Congress would actually care more about getting the economy turned around and working with this president to pass that plan and create the million jobs that would be created.

STEPHANOPOULOS: As you know, Congress has gone home, Congress has gone home. So that's not going to happen this year.

SCHULTZ: Well, we shouldn't have gone home before passing the American Jobs Act. They care more about defeating this president than they do about working with him to pass a balanced plan and continue to get the economy turned around. The ball is in their court.

STEPHANOPOULOS: Mitt Romney also says in an interview this morning that he doesn't want any more intervention from the Federal Reserve between now and election day. Do you agree with that?

SCHULTZ: I'm sorry, I missed your --

STEPHANOPOULOS: Mitt Romney also said that he wants, in an interview out today, that he wants no more intervention for the Federal Reserve between now and the election day. Do you agree with that?

SCHULTZ: Well, I think that's up to the Federal Reserve. The Federal Reserve is an independent financial institution. It's important that we not dictate from the White House, or certainly from candidates for president of the United States, what the Federal Reserve should be doing. That's why they are an independent institution.

STEPHANOPOULOS: The Democratic Senate Leader, Harry Reid made a pretty explosive charge this week, he said Mitt Romney hasn't paid taxes in 10 years. Here he was on the Senate floor.

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REID: The word is out that he hasn't paid any taxes for 10 years. Let him prove that he has paid taxes. Because he hasn't.

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STEPHANOPOULOS: Now, you know, Senator Reid's only source there, according to him, is an anonymous Bain investor whose identity he won't reveal. Is it appropriate for the Democratic leader in the Senate to make a charge like that with no more evidence than an anonymous source?

SCHULTZ: George, I don't know who Harry Reid's source is, but I do know that Mitt Romney could clear this up--

STEPHANOPOULOS: That's the point, isn't it?

SCHULTZ: -- in 10 -- I do know that Mitt Romney could clear this up in 10 seconds by releasing the 23 years of tax returns that he gave to John McCain when he was being vetted for vice president. Or even 12 years of tax returns that his own father said were what was appropriate. Because one year of tax returns, like he's released, could just be for show. And let's not forget--

STEPHANOPOULOS: But it's one thing to say--

SCHULTZ: -- that a week ago, hold on a second, George, a week ago, Mitt Romney said in response to a reporter's question when asked if he had ever paid a rate below 13.9 percent, that he would check and get back to us. And you know, I'm glad I wasn't holding my breath waiting for Mitt Romney to get back to us on answering that question, because he still hasn't responded whether he's paid a lower tax rate.

STEPHANOPOULOS: He hasn't, but he has denied that he didn't pay taxes for 10 years. And I take your point that it would be right to show more tax returns. At the same time, I don't believe that you believe that it's OK to make a charge like that, 10 years of not paying taxes, with no evidence.

SCHULTZ: Like I said, I don't know whose Harry Reid's source was, but I do know that this is a question that has swirled around Mitt Romney for this entire campaign. I do know that he could clear it up just like that, lickety-split, by releasing his tax returns, which every major candidate for president of the United States has done except for Mitt Romney. I do know that there are massive questions about why he has a Swiss bank account, why he has investments in the Cayman Islands and a Bermuda corporation that he has transferred to his wife's name one day before he became governor of Massachusetts.

Those are questions that when you're running for president of the United States, that the American people deserve answers to. Why is Mitt Romney refusing to answer them? Why is he refusing to show the American people what he was willing to show John McCain 23 years of information on? There's got to be a reason.

STEPHANOPOULOS: I take it from your answer you're not going to repudiate Senator Reid's charge.

SCHULTZ: Everybody is responsible for saying the things that they have information on. Harry Reid says that he has a credible source. I know that this question is not just generated by Harry Reid. It's been asked by countless reporters, by voters that want to know--

STEPHANOPOULOS: On that question, Congresswoman, do you stand by Harry Reid's charge?

SCHULTZ: -- about -- more about Mitt Romney's finances. What is he hiding? I stand by the fact -- George, I stand by the fact that I believe, like the overwhelming majority of voters believe, because the polls all show, that Mitt Romney owes us more than one year of tax returns. Owes us answers to questions about his overseas investments, owes us answers to questions about why he's decided to invest in foreign countries, as opposed to investing in the United States. Owes us answers to questions about why as head of Bain Capital, he shipped jobs overseas. Why did he have a tax plan that actually continues tax incentives for shipping jobs overseas, when President Obama has a plan to incentivize companies to bring jobs back here. Those are the questions that need to be answered, and they weren't raised by Harry Reid. They were all raised by voters, and reporters, and people who have a right to ask, and Mitt Romney has yet to come clean on the answers on any of those questions.

STEPHANOPOULOS: So it's clear you are not going to repudiate that charge from Harry Reid. One final question, President Obama celebrating his birthday. He got a little present from the RNC, was sent to the Democratic National Committee over the weekend. I want to show it. Birthday cake saying, "you didn't bake this. Happy birthday, Mr. President." Do you think the president is going to be able to shake "you didn't build this" line?

SCHULTZ: I think that it would be great if Republicans would make sure that they weren't supporting cuts in investment like education, like infrastructure, like all the things that we know help businesses thrive. President Obama has always been committed to making sure that small businesses have an opportunity to thrive, large businesses. That's why he pushed through 18 different tax breaks for small business owners.

But I know President Obama has also backed up that support with action by supporting investments in infrastructure, education, the Internet and the economy, so that businesses have more of an opportunity to thrive, while Republicans support slashing, and Mitt Romney supports major cuts in those kinds of programs, which would harm businesses' ability to thrive.

That's the choice we have got in this election. Do we want to continue moving in the direction that President Obama has taken? 29 straight months of job growth in the private sector, a president who wants a balanced approach to deficit reduction. Asked folks to pay a little bit more who can, so that we can make sure we can make those investments in education and the economy.

We're all in this together. This election should not be about defeating Barack Obama. It should be about getting the economy turned around, and that's what Barack Obama is committed to.

STEPHANOPOULOS: Let's get a response now from Republican National Committee. Thank you, Congresswoman. Reince Priebus, the chairman of the RNC.

SCHULTZ: Thank you, George.

STEPHANOPOULOS: Will join us right now. Good to see you, Mr. Chairman.

PRIEBUS: Good morning. Good morning, George.

STEPHANOPOULOS: Let's get a response right away to what you just heard from the congresswoman.

PRIEBUS: Do we want to continue down the direction of unemployment above 8 percent for countless months, a president that hasn't lived the mission, hasn't fulfilled the promises. People aren't better off today than they were three or four years ago. Do we want to continue in that direction? Heck no.

And as far as Harry Reid is concerned, listen, I know you might want to go down that road, I'm not going to respond to a dirty liar who hasn't filed a single page of tax returns himself. Complains about people with money but lives in the Ritz Carlton here down the street. So if that's on the agenda, I'm not going to go there. This is just a made-up issue. And the fact that we're going to spend any time talking about it is ridiculous.

STEPHANOPOULOS: You say you are not going to respond, but you just called him a dirty liar. You stand by that, you think Harry Reid is a dirty liar?

PRIEBUS: I just said it.

STEPHANOPOULOS: So, what do you want from him right now?

PRIEBUS: Listen, this president has a job to do. And Harry Reid has a job to do. We have an opportunity in this country to save the very idea of America. To bring back the days of liberty, freedom, the American dream.

And the fact is, we're just -- we're not doing well right now, as an economy. And this president, is the head of this country. And he has not fulfilled the mission and he hasn't lived up to the promises that he made to the people of this country. And it's hard to believe that the president of 2008, when he campaigned and said he was going to bring America together, that he would trot out Harry Reid and try to divide this country and spread this division and hatred. It's ridiculous, it's wrong, it's untrue. And it's just going to hurt the president.

STEPHANOPOULOS: Setting aside Harry Reid's charges, a lot of Republicans, as you know, a lot of major figures in your party, have come forward and said that Mitt Romney should just release more of his tax returns. Wouldn't that make a lot of these questions go away?

PRIEBUS: George, here's what I think. I think this president has got a problem with the American dream. You know, when I grew up -- and I know that both Republicans and Democrats listening to this right now agree with this -- when I grew up, in a great place called Kenosha, Wisconsin, my dad was a union electrician, my mom was a realtor. We drove around town, and when my parents and we drove past a beautiful house on the corner, my parents didn't point at the house and say, hey, look at this lousy people in this beautiful house. Look at this guy and his new Corvette.

My dad did probably the same thing your dad did and a lot of dads out there. He turned around, and he said, listen, pal, if you work hard and you go to school, mom and dad, we hope you live in that house. We hope it's two times bigger than that house. That's the American dream.

And this idea that we're spending all of our time just killing people because they live the American dream and made something out of nothing and made money -- I mean, this is crazy talk. And I just think we need to get back to the issues.

STEPHANOPOULOS: So the short answer is, you don't believe it's hurting him, you don't think he has to do anything more on the tax returns?

PRIEBUS: I think it's hurting the president -- I think it's hurting the president because people know that the job to do in this country and the job that this president claimed that he was going to do was, what did he say? Jobs one. He hasn't met with his jobs council. The entire philosophy of Bill Clinton -- excuse me, of Barack Obama -- can be summarized in one word, and that's Solyndra. That's Barack Obama's philosophy.

STEPHANOPOULOS: Let me ask you another question about taxes. The president also charging this week that Romney's tax plans would raise taxes on the middle class. And as backup, they point out this study from the Tax Policy Center. I want to read their major conclusion. It says that, "our major conclusion is that any revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed would provide large tax cuts to high-income households, and increase the tax burdens on middle- and on lower-income taxpayers." They're saying that it's mathematically impossible under the assumptions that Mitt Romney has not to raise taxes on the middle class?

PRIEBUS: Well, that's just not true, because they didn't take in a lot of -- first of all, this thing was written by a former employee of Barack Obama. That's No. 1.

STEPHANOPOULOS: Well, the head of the center used to work for President Bush, and so did one of the authors of this study.

PRIEBUS: OK, but you know--

(CROSSTALK)

STEPHANOPOULOS: Even Mitt Romney has cited this tax institute as a credible source.

PRIEBUS: OK, we'll put aside that the author worked for Barack Obama. We'll put that aside. But secondly, the study itself said it wasn't going to be a score on Mitt Romney's plan. Thirdly, it doesn't take into account the effect of deficit reduction plans that Mitt Romney has put in place, reducing spending from 24 percent of GDP down to 20. Reducing individual income tax rates 20 percent across the board for middle-class families. Getting rid of the big Obamacare tax. All of that deficit reduction, individual income tax reduction, and a plan to get rid of Obamacare brings down the deficit, that -- that makes the growth rate in this country increase. And all of those assumptions weren't taken into effect, George. They just weren't in this plan.

So I think the growth rate that will come out of Mitt Romney's plan, of reducing taxes on small businesses, reducing taxes on individuals and cutting spending in Washington, that, together, creates growth, will increase individual income rates and jobs and get America moving again.

STEPHANOPOULOS: Finally, Mitt Romney closing in on vice presidential selection. I want to put up something that Stephen Hayes and William Kristol at "The Weekly Standard" just wrote this week, and they say, go for the gold, Mitt. They want a bold choice for vice president. And what they write is that what looks safe can be risky. Rob Portman, the senator from Ohio, was George W. Bush's budget director. Tim Pawlenty, former governor of Minnesota, his presidential campaign was a disaster. The 2010 election was the best for Republicans in a long time. Ryan and Rubio -- that's of course Congressman Paul Ryan, Marco Rubio, senator from Florida, embodied the spirit of 2010. Pawlenty and Portman don't. They want a bold choice, they think that's Marco Rubio or your fellow Wisconsinite Paul Ryan, do you agree?

PRIEBUS: Well, Paul is one of my best buddies. I went to law school with Marco Rubio. And I think the other two guys, Rob and Tim Pawlenty, are great as well. So I think that we're going to have an exciting August, a great convention. Unfortunately, we have got a president that doesn't seem to connect the dots. We have got the birthday of the credit downgrade today. And we've got a Democratic Party that thinks we're moving in the right direction. So I think the American people see things differently. We're going to give people a bold choice. I don't think people want another four years of this misery. And we're going to give them the antidote, and that's Mitt Romney in November.

STEPHANOPOULOS: We will see you at the convention. Mr. Chairman, thanks very much.

PRIEBUS: Thank you, George.

STEPHANOPOULOS: Coming up, our powerhouse roundtable weighs in all of the week's politics.

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CLINT EASTWOOD: It's halftime, America. And the second half is about to begin.

FORMER GOV. MIKE HUCKABEE, R-ARK.: I believe in free speech. So I thought, well, let's just show appreciation not just for chickens -- actually I don't think that the chickens are too happy about today. They really gave their lives in mass numbers.

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STEPHANOPOULOS: And later, the latest from London.

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CONAN O'BRIEN, TALK SHOW HOST: Yesterday, Michael Phelps set an all-time, all-time record for gold medals. Yes, Phelps has so much gold on his chest, he's been asked to join the cast of Jersey Shore.

STEPHANOPOULOS: Roundtable is coming up after this from our ABC stations.

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UNIDENTIFIED FEMALE: The fast food chain is the new ground zero in the culture wars over gay marriage.

DAN CATHY, CHICK-FIL-A CEO: I think we're inviting God's judgment on our nation when we shake our fist at him and say we know better than you as to what constitutes a marriage.

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HUCKABEE: This was not a protest. It was an affirmation of the rights of an owner of a business to speak his or her convictions.

JON STEWART, HOST, DAILY SHOW: We are Chicago! A city built on gambling, corruption, murder and ballot stuffing! Not intolerance.

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STEPHANOPOULOS: Chick-fil-a's appreciation day set sales record on Wednesday. We'll get into that controversy coming up. Let's introduce the roundtable now. Joining as always by George Will. Steve Rattner, former car czar, investor now. Jonathan Karl covers Congress and politics for us. Also Van Jones, former Obama adviser, now the head of Rebuild the Dream. Also author of the book of the same name. And Ann Coulter, whose book "Demonic: How the Liberal Mob is Endangering America" now out in paperback. Thanks to all of you for coming in today. And, George, let's start out on the economy coming off that Friday employment report.

You look at it and you see some good news and bad news for either political side there. What I take away from it is basically we have the economy -- the economic table is set pretty much going into the election.

WILL: Yes, July was the 42nd consecutive month of unemployment over 8 percent, which means October, we can be fairly sure, will be the 45th consecutive month. (inaudible) is a record.

Back up a little bit. In 2011, we created on average 153,000 jobs a month. In 2012 so far, 51,000 a month. 172,000 this most recent month. That means we're creating 50,000 more jobs a month than necessary just to keep pace with the growth of the workforce. That means if we're going to reduce this notion of unemployment out there, in increments of 50,000 a month, would take us 10 years. If you doubled our rate of job creation, it would take us three years, so this is not a happy picture.

STEPHANOPOULOS: No way it can be under 8 percent on election day.

RATTNER: I wouldn't say no way. It's 8.2 or 8.3 percent. It could go down a little bit. But the fact is, I think this was an unambiguously a pretty good month. 160,000-plus new jobs, and most of them in the private sector. In fact, more than 100 percent of them in the private sector, and it's slow. I don't disagree with George. It's slow, but I think we're making slow, steady progress.

COULTER: I don't think there's any way to make these numbers look good, but this is the recovery from the recession. Recovery, you're supposed to be, it's supposed to be the second two years of Reagan. this is supposed to be the 1984 election for Obama. And no matter how you talk about the numbers and adding these jobs and those jobs, everyone knows that people are out of work, which is really going to color this whole campaign.

You often hear it said by the party out of -- the person out of party running, well, my opponent can't run on his record, so that's why he's going to talk about personal attacks. It's actually true this time. Obama cannot run on his record, which is why they're so obsessed with the tax records, which is why Romney has to be careful about who he picks for vice president. No scandals, because that's all Obama will talk about.

STEPHANOPOULOS: We're going to get into one of the points that Ann makes, Van, is that Ronald Reagan was able to win, even with 7.2 percent unemployment back in 1984, because the trend was in much better shape than what the president is seeing now.

JONES: Sure, the good news here, is first of all, no double dip. The danger going into this month was, if we saw, again, this month what we saw last month, maybe got a double-dip recession right in the middle of November. That is game over. There will be no double dip, we're still adding jobs.

I think the other thing is who do you compare Obama to? He has created 4.5 million private sector jobs in four years, which is better than George Bush in eight. No. 1, and No. 2, Romney says he's a job creator, but when you look at his performance in Massachusetts, his state fell to number 47 out of 50 in job creation on his watch. America is going this way. We don't want to fall to No. 47 out of 50 globally. I think we're moving in the right direction here.

STEPHANOPOULOS: And both sides, Jon Karl, are starting to talk more about their plans. I want to get to the tax plans in a second, but first, this whole back and forth over Harry Reid and the tax returns. You cover Capitol Hill every day. You have been covering Harry Reid an awful long time. What do you make of how he's doubling and tripling down on this charge without releasing any evidence?

KARL: Well, first of all, it's one of the most outrageous charges that I've ever seen actually made on the Senate floor. Sometimes you see this stuff out, you know, first there was an interview with Huffington Post, that's one thing, but when Harry Reid comes to the floor of the Senate and makes this outrageous charge that has absolutely no evidence -- I mean, Mitt Romney paid $3.1 million to the IRS in the one tax return that we've seen so far. He paid taxes. It's a completely false charge. But Reid loves it. The Democrats love this. Because no matter how much he digs in, no matter how much he gets attacked, you know, here or by Jon Stewart, or anywhere else, it gets the story out there again and again.

And I'll tell you, Romney played into it by telling Harry Reid to put up or shut up, and then it becomes this back and forth. Instead, he should have laughed it off, he should have made a joke about Harry Reid's imaginary friend and moved on. Because it's an unbelievable --

(CROSSTALK)

WILL: Harry Reid's source, if we are to assume he actually has one, is identified by Harry Reid as an investor in Bain. That's as though I own some Microsoft stock, which I do, and I said, well, as an investor in Microsoft, I know have opinions on Bill Gates' tax returns.

Look, in 1950, Joe McCarthy went to West Virginia, didn't know what to tell to the Women's Republican Club of Wheeling, West Virginia, so he said I have in my hand a list of 205, we think that are -- 205 communists in the State Department. Didn't have a list. Harry Reid doesn't have any evidence either. This is McCarthyism from the desert (ph).

RATTNER: Look, I don't disagree with either of you guys about Harry Reid. I don't think it was appropriate. But you still come back to the question, why won't he release his tax returns? If he's paid all the taxes he says he's paid, he says he's paid a lot of taxes every year, why not just release them and move on? And end this discussion.

STEPHANOPOULOS: And it's true, Ann Coulter, that even though Mitt Romney did tell ABC's David Muir last week that he would show that he's paid more than 13.9 percent at various times, he said he went back to check, nothing came out since then. Can he hold that position?

COULTER: He absolutely should not release any more tax returns. He has released two years. Bill Clinton wouldn't release his medical records. You know, people kind of wondered about that. We know after the JFK presidency, you could have an issue with a drug addict president, but he just dug in his heels--

(CROSSTALK)

COULTER: No, but he's not releasing his tax returns. That's something that the American people should know, we didn't get two years. We have two years on Romney. You know perfectly well, the media, this is Obama's modus operandi, and unfortunately Romney isn't divorced. Hopefully, his vice presidential candidate won't be divorced. It's always dirty politics.

You remember when Romney was -- or Obama was running against McCain and Sarah Palin. What did we get? False rumors of a McCain affair. We had investigations into the Palin marriage, claims they were getting divorced. They have nothing on this Mormon, and they want his tax records. If they releases 10 years, they'll demand 20 years.

STEPHANOPOULOS: McCain got 23.

JONES: And as James Carville famously said, the only person who has seen his tax returns, which is John McCain, saw 23 years of tax returns, and then picked Sarah Palin. So there is something that is being hidden here.

COULTER: Nothing is being hidden.

JONES: Well, then why -- it's certainly not being revealed. But hold on a second. This is the kind of stuff I think that turns people off from politics. I mean, this is exactly the problem we have right now. Ordinary people don't care about this stuff. And the stuff that regular people care about more than anything is, you know, their houses. Right now, one third of the people who are watching this show, their homes are under water.

It used to be, they were talking about the good old days earlier on the show. It used to be when you signed that mortgage check, you were building wealth for your family. You got a third of Americans who are losing wealth, and in Washington, D.C., the big story that was missed, you got Ed DeMarco, a Bush administration holdover, who is still being held on to by Obama, who sits back and says, Fannie and Freddie are now--

STEPHANOPOULOS: He's the head of the Federal Housing Administration.

JONES: The Federal Housing Administration.

STEPHANOPOULOS: Oversees Fannie and Freddie. Fannie and Freddie came up with a report that said if they just reduced some of these mortgages and gave some mortgage relief and stopped overcharging people for their homes, America would save $1 billion in foreclosures and you keep people in their houses. This one bureaucrat says, no way, takes it off the table. That's wrong. That's hurting ordinary Americans. It's not even being talked about in Washington, D.C. President Obama should fire Ed DeMarco, get him out of there, but somebody in office is going to take care of the real issues. The American people can't continue to lose their shirts trying to get people to stay in their houses.

(CROSSTALK)

STEPHANOPOULOS: -- didn't do more about that? I know he disagrees, I know he disagrees with Ed DeMarco, but he didn't take action.

RATTNER: Well, look, the housing situation is one of the most complicated policy issues we have, because we all would like to do more for homeowners, but I think there's a feeling in America, which I understand, of sort of equity in the sense that someone who overborrowed, who took out a second mortgage, used it to buy a new television or consume, is now under water, is living next door to somebody who acted responsibly and didn't take out a second mortgage. And so this is a highly emotional issue in Washington.

JONES: The great thing about the report that came out was, if you narrowed it to people who are not in that situation, you would actually save $1 billion for America. So you've taken it off the table, you're not talking about people who overborrowed. You're talking about the responsible people. They can't get help from this administration, they can't get help from Washington, D.C. That's why you are going to have underwater voters sitting out this election in droves. That hurts the president. And their inability to be a part of the economy hurts the economy. You've got more jobs created--

(CROSSTALK)

COULTER: -- families. I think they're whole house flippers. You noticed that in the housing crisis -- they won't give you the numbers. How many of these houses that are under water are second homes. But noticeably, all the housing crisis hot spots -- Arizona, Nevada, California, Florida -- not New York City, it's the hot spots--

(CROSSTALK)

WILL: 75 percent of mortgage holders who are under water are continuing to pay their mortgages. If you go to them now with competitive debt forgiveness -- the president saying that maybe student loans should now be forgiven. Now we're going to start forgiving this, breaking contracts -- in a sense what they are -- then you're going to have a classic case of moral hazard, where the incentives are for perverse behavior, and you're going to incentivize the 75 percent of honorable people paying their mortgages to stop.

STEPHANOPOULOS: Let's talk about the broader tax plans that each campaign has. And the president putting out ads against Mitt Romney's tax plan this week. You saw me talk to Reince Priebus about that tax institute study. And George, let me ask you about this. You heard what Priebus said, the tax institute though does have a reputation for nonpartisanship. They did make the assumption that there would be some economic growth. Yet they still come up with the conclusion that it's mathematically impossible for Mitt Romney, if he has those big tax cuts for the wealthy, not to raise taxes for the middle class. Is he going to have to do a better job of responding to that?

WILL: He's going to have to do a better job of his responding in some detail to the loopholes that he plans to close. Because that's the heart of the matter. Now, we had a little experience with that this week. The Finance Committee, this is the time of the year where they do the extenders. They extend all these special tax breaks that never should have been passed in the first place. Let me give you one example. Mitt Romney has come out against extending, as he should, the wind power tax break. Costs $1.8 billion a year. On the Senate Finance Committee, the vote was 19 to 5 to extend it. Half the Republicans on the committee voted for this bit of industrial policy, the government picking winners and losers. The Republicans are just as bad, just as unreliable as the Democrats.

RATTNER: Yes. But the problem with this, George, as you just actually said, is that is a $1.5 billion a year item. Mitt Romney's tax plan would cost $360 billion in 2015. The only way you can pay for that as the Tax Policy Center found was to eliminate 65 percent of all the loopholes. And when we say loopholes, we're not talking about corporate jets, we're not talking about oil and gas, we're talking about home interest mortgage deductions. We're talking about the fact that your health care benefits are now taxed. We're talking about the fact that your 401(k)s and your IRAs are now taxed.

So let's assume that even the people are willing to accept that politically, you then get to a situation where actually that hurts the middle and lower class much more than it hurts you and me. And the fact is that under Romney's tax plan, only people making over $200,000 a year would actually end up ahead. Everybody below $200,000 a year would end up behind. And those are the facts.

And as you pointed out, George, the head of this Tax Policy Center was a member of President Bush's Council of Economic Advisers.

KARL: You know, we've never seen a presidential election decided by a Brookings Institution study.

(LAUGHTER)

KARL: But I think Chicago is going to try, and the Obama campaign has made it clear that this study is something that -- and its findings is something that they're going to talk about from now until November. But the only thing to consider is the utter implausibility of the Obama plan as well, the idea that you can simply tax the rich and end up getting the budget anywhere near to balance. So I'll say that both of these guys have presented plans without much detail, that are utterly implausible. And frankly, I think both of them, when they actually get into office, either one, I mean, next term, you're going to have to raise taxes.

JONES: The difference, though, is that you have Obama putting forward a plan that would raise taxes on himself. And you have Romney putting forward a plan that would cut taxes for him and raise taxes on everybody else.

KARL: But you're not going to get the (inaudible) in the balance by raising taxes on Barack Obama.

JONES: But, we're talking about two different things here. We have a problem with Mitt Romney, because it seems that Mitt Romney doesn't understand what ordinary people are going through. He's talking -- he's had these magical mystery numbers about, oh, we're going to close loopholes. When you dig down into it, the levels, what he's calling loopholes as you are saying, are what ordinary people rely on to keep moving forward in the economy. So I think what you got here is do you want to elect somebody who won't tell you how much money he's making and won't give you his tax returns, but with all he's put on paper, will cut his taxes and raise yours. That's the real question.

COULTER: I think the point isn't whether Barack Obama's personal taxes get raised. We have to run this behemoth neverland ranch of Washington, D.C., and the main point is cutting the size of government. I mean, even when Obama famously freeze federal government salaries, remember that? When he first came into office. That's his big fiscal austerity. That didn't freeze their salaries. They still get their automatic pay increases that go into effect every year. You have the government running around having these huge conferences in Las Vegas and Mexico. That's what Romney is selling. He is the Bain guy, he's going to cut down this ridiculously sized government.

Did you see the story today with the Amtrak food cart, with $10 two-week old turkey, they're losing $80 million a year, they are only open an hour a week. That's how the government runs things. And that's why you need a Bain guy to come in and cut the size of government, not just keep figuring out how can we get more money to fund this.

STEPHANOPOULOS: The question is though how plausible is, getting to your point about tax extenders, George -- I saw one study from the Center of Budget and Policy, it has a liberal leaning but seen as credible from both sides of the isle, saying if you take Romney's assumptions, you're talking about a 49 percent cut in everything that's not defense. That's simply never going to happen.

WILL: And all the money is, as Steve said, it's in really two big ones. It's in the mortgage interest deduction and the nontaxing of employer-provided health insurance. There's zero votes in Congress for either, for cutting either of those. Zero.

RATTNER: So if there are zero votes in Congress for cutting either of those, then how does he make up the revenue, the $360 billion that's lost by Romney's tax cut?

(CROSSTALK)

JONES: The other problem that you have, which again I think ordinary people care about is, you got -- if this bill goes through, if this budget goes through, good analysts say you're going lose 4 million jobs right away. We had to fight to get 4.5 million jobs. This -- not only is this tax plan for him going to cut his own taxes and raise yours, he's also going to wipe out 4 million jobs.

JONES: Look, all the analysts show, when you look at the Ryan budget and all the stuff -- inspired by that stuff -- you wind up losing jobs.

COULTER: Government jobs.

(CROSSTALK)

JONES: We can have this fight right here right now. The real tax, the real job creators are middle-class people who go out there and buy products and spend money. That's what creates jobs. That gives entrepreneurs the opportunity to go out there and sell something to somebody.

STEPHANOPOULOS: I want to get to the next big decision that Mitt Romney has to make, choosing a vice presidential running mate. Jon Karl, you're covering this for us. You saw me ask Reince Priebus about the bold versus boring pick. And that is -- we are in that final four or five right now. Right?

KARL: I absolutely think that's the case. Right now, the big decision facing Mitt Romney, is does he go with solid and safe? Does he pick Tim Pawlenty or Rob Portman? Or does he go big and bold, and the two names that you see there are Paul Ryan or Marco Rubio. And I can tell you that right now, they're looking at the big and bold. And I think that by the day--

STEPHANOPOULOS: Big and bold.

KARL: I think by the day, the chances of big and bold are more plausible when you see Romney behind in virtually all the battleground states. He's being urged by some very prominent voices within the Republican Party to go big and bold, and the message that has come back to particularly Marco Rubio supporters is, reassurance that the Romney campaign he's under serious consideration.

That said, George, if you talk to Republicans close to Romney, still the overwhelming expectation is that he goes to the one of the safe picks.

STEPHANOPOULOS: Even though there's increasing pressure for bold.

KARL: There is increasing pressure, and I think an increasing chance.

WILL: Question is, what is the Romney campaign's assumption about the basic dynamic of this race? If they assume accumulating bad economic numbers will push him across the finish line -- then --

STEPHANOPOULOS: Which has been their assumption.

WILL: Which has been their assumption. Then, fine. Go with safe and cautious. If not, if you think that at this point in the summer, there's time to change the basic perception of Romney himself as someone risk-averse in a country that needs risk taking, then bold would measure up, and I think the longer it takes, the more bold may rise. And I would add to that list Bobby Jindal.

STEPHANOPOULOS: Do you accept the premise that Ryan and Rubio are probably at the top of that list?

WILL: I have no way of knowing.

RATTNER: I'd say two things. First, when you look at the polls, it suggests that the public doesn't feel quite as bad about the economy as maybe some of the people sitting next to me do. Including the president's handling of the economy. He gets decent marks. The public still blames most of this problem on the previous administration and the mess they inherited.

I personally would love to see him pick Paul Ryan, because then we could actually have a decision about Romney's economic plan, which he is not discussing, because I think when people actually understand his plan, they'll understand all the tax things that we talked about. They'll understand the spending implications of the Ryan budget plan in terms of what it does to Medicare, privatizing it, what it does to Medicaid, turning it into a block grant program, and then 33 percent cuts that are going to occur in a whole series of programs, including things like food stamps. Just to make his numbers work. So I would welcome Ryan and the discussion we have about it.

STEPHANOPOULOS: And the counter-argument there is that Paul Ryan is the best person to defend his own plan, and Romney is going to get saddled with it anyway.

COULTER: I think that's right, and you kind of want to keep Rubio and Ryan where they are. I don't think it's so much bold versus drab, as whether -- whether Mitt Romney needs someone who will galvanize the base, and I do not think he needs that. I think the base -- the base definitely needed galvanizing with John McCain. I wasn't going to vote for John McCain until we picked Palin. The base is galvanized by Obamacare. That's not what you need here. What you need, because of the way Barack Obama runs for office, is to go into the divorce records of the man he's running against. He needs someone who has no scandal, that's purer than Caesar's wife. That's all he needs.

STEPHANOPOULOS: And it's not going to be your choice, Condi Rice.

JONES: It won't be Condi Rice, and I have to say I'm heartbroken. Disappointed by you. You talk about--

(CROSSTALK)

JONES: Nobody's talking about it anymore. But I was proud to be the first person on this show to put her in. And now it looks like she was taken out, but there's always 2016.

COULTER: She's not divorced. She could be a good candidate.

(CROSSTALK)

STEPHANOPOULOS: Before we go, George, Ann Coulter talks about energizing the base. I think we saw one base that was certainly energized this week by the -- in Texas, the Tea Party had a big victory by the election of Ted Cruz. He's going to be the Republican Senate nominee, almost certainly the next senator from Texas.

WILL: Another example of journalistic malpractice in this country. The constant writing off of the Tea Party, which just goes about its business of electing senators. They'll elect Cruz, they'll probably elect Mourdock in Indiana, they'll probably elect Deb Fischer in Nebraska. Often, George, the most interesting and important fights in American politics aren't between the parties, they're within the parties. People say about Ted Cruz, well, he's part of the anti-intellectual Tea Party. Well, Princeton, Harvard, clerked for Justice Rehnquist, I don't think so.

(CROSSTALK)

WILL: Then, they say, well, he doesn't play well with others. And people in Texas say, he doesn't play well with others? Send him to Washington.

STEPHANOPOULOS: We have got a couple more primaries coming up. Missouri and also Wisconsin, where Tommy Thompson, the former governor, facing some trouble as well from Tea Party challenger.

KARL: And I would say, Deb Fischer in Nebraska, not exactly a Tea Party candidate, although she was endorsed by Sarah Palin. Sarah Palin is 4 for 4 on her Senate endorsements. But they are not all Tea Partiers. She endorsed Orrin Hatch. And Fischer in Nebraska was not endorsed by any of the Tea Party groups. So, it's a bit of a mixed record. But I'll tell you, the big difference this year, George, is that none -- we have no people in here like O'Donnell or Angle. There are no Tea Party candidates getting nominated who seem clearly headed towards defeat.

WILL: At Ted Cruz's victory party, they served Chick-fil-a.

(LAUGHTER)

STEPHANOPOULOS: I want to talk about that, Ann Coulter, we did see those record sales at Chick-fil-a on Wednesday. Kind of a (inaudible) for the counter-kiss. And what does that tell you about the gay marriage issue going into the election?

COULTER: It tells me something about polls generally, because they keep taking Gallop polls showing gay marriage is so popular. Well, every time people have been allowed to vote on gay marriage, and that's in about 35 states now, it has lost. It has lost in Oregon, in Washington, in California. And now you see this guy, and I actually what he said, because he made it clear it wasn't an anti-guy thing. He said, look, all the founders of this company are married to our first wives. It's genuinely a pro-marriage position to oppose gay marriage. And when you see crowds like that coming out, no, I'm sorry, I don't believe the polls on gay marriage. Let us vote. Those polls I believe, and it makes me suspicious at the polls on the presidential election.

JONES: This became not an issue about marriage equality, it became an issue about free speech, and appropriately so. Once the mayor stepped in.

STEPHANOPOULOS: You think that was a mistake.

JONES: I think it was a huge mistake, because once the mayor stepped in and said we're going to use the power of the government to punish people because they have a different opinion, then the entire country had to stand against that kind of abuse of authority. However, I think, citizen boycotts of Chick-fil-a or any other company that you do not agree with, that's appropriate. Citizen boycotts are appropriate. Government stepping in, not appropriate.

KARL: But you know, George Soros is the dominant owner of Dinosaur Barbecue in Syracuse, New York.

(CROSSTALK)

KARL: Great barbecue place, there are a few others in New York State, and I know a lot of conservatives that love Dinosaur Barbecue, eat Ben and Jerry's ice cream. I think there is something a little bit odd about our politics.

COULTER: I didn't know that about Dinosaur.

KARL: Maybe Ann will never go again. But I mean --

(LAUGHTER)

STEPHANOPOULOS: Got to take a quick break. We'll be back in 60 seconds with our top Olympic moments.

(BEGIN VIDEO CLIP)

COLBERT: There is one thing I have never understood about the Olympics. For some reason, they open the games with the halftime show. I think it's metric. I don't know.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MICHAEL PHELPS: Just went out there and swim. That's how we know he can, (inaudible) hand on first. It's weird to think that was my last time ever. But it's something that I'm very happy for and very proud of. As soon as I stepped up onto the podium, I could feel the tears start coming. I tried to fight it. But then I just decided to just let it go. I was able to really put the final cherry on top of the night. There's no better way to finish a meet like this.

(END VIDEO CLIP)

STEPHANOPOULOS: Most decorated Olympian ever, Michael Phelps, 22 career medals, 18 golds. If he were a country, that would put him 36th in Olympic history. Overall medal count right now, neck and neck. Gold medals, US over China 27 to 25. That's on the gold medals. Tied in overall medals, 55 each with China. Van, let me go to you, your best moment of the week.

JONES: Watching Gabby's mom.

STEPHANOPOULOS: Gabby Daniels.

JONES: Gabby Daniels' mom break down in tears. You know the story. Here is this kid, she grew up in poverty, she never (inaudible). Her mom has to send Gabby away to a family she doesn't know. That family takes her in. She's mothering her kid by Skype. And she shows up at the Olympics, that little girl gets the gold medal. That's America. We're one family. Color doesn't matter. It's having that common goal.

STEPHANOPOULOS: And that is America. She's now on the cover of the corn flakes box. Steven Rattner.

RATTNER: I was actually going to say the same thing. You know, when you watch these young kids, it's so amazing to see how hard they try, the stress (ph), the way they perform, but when you see someone like Gabby come from where she came and what she gave up and what she had to do to succeed was really quite amazing.

STEPHANOPOULOS: And what are you going to be watching for this week?

KARL: The USA basketball team. I mean, you know, they dominated Tunisia, they dominated Nigeria, and then they came up against Lithuania and came damn close to losing.

(LAUGHTER)

KARL: Is the dream team really the dream team?

STEPHANOPOULOS: Did you watch?

COULTER: No, I was taping my next book all week. But I caught up this weekend to watch Katie Ledecky win the gold in swimming because she is a niece of my friend John.

(CROSSTALK)

STEPHANOPOULOS: George, I know it's hard for you to watch Olympics during baseball season, but I think all of us were actually struck by what you wrote this week about so far -- your column this morning, pretty simple but staggering conclusion. You write that football just can't be fixed.

WILL: The human body is no longer built for the kinetic energy of the National Football League and even further down to high school. In 1980, George, there were three NFL players over 300 pounds. Today there are three over 350 pounds, and 352 people on the 2011 rosters weighed more than 300 pounds. Over 20 yards, which is where a lot of football is played, these guys are as fast as cats, fast as running backs, and the kinetic energy is producing what is called chronic traumatic encephalopathy (ph), CTE, get used to that, because it's going to be the subject of lawsuits and other things. The crucial word is chronic. Repeated, small but repeated blows to the head, the brain floating in the pan in the skull, now we know causes early dementia and other problems.

STEPHANOPOULOS: So what's to be done about it? Because right now, there's no evidence that the American public is ready to turn away.

WILL: It will start down below. It will start at the small level of kids playing football in grade school and then in high school. We now in our hypercautious parenting put crash helmets on children riding tricycles. How many of these parents are going to let their children go out and play football once they learn, again the chronic, the cumulative effect of small brain trauma?

STEPHANOPOULOS: Any way to fix football?

JONES: I hope so. But I was taken aback. I like football. My dad loves football. But I, when you start hearing about people, in your column, they get into their 40s, their 50s, their 60s, they're demented. They're killing themselves because they just can't live with it, I think we've got to look at it.

STEPHANOPOULOS: No way Congress is stepping in yet.

KARL: I see no way. But it's astounding. We were talking about Refrigerator Perry, remember when he came on, in 1985, I mean, he just looked like a giant on the field. And now he would be on the lower end, you know, smaller end.

UNIDENTIFIED MALE: Which one lied? The Senate committee can't tell and we may never know.

STEPHANOPOULOS: Was it 1989, 1990 or 1991? We'll be right back with the answer.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

STEPHANOPOULOS: So, what year was it? When did the Soviet Union disappear and Anita Hill confront Clarence Thomas? 21 years ago, 1991.

And now, we honor our fellow Americans who serve and sacrifice. This week, the Pentagon released the names of 12 soldiers and Marines killed in Afghanistan.

And finally, your voice this week. Today's question comes from Kelly Harper Collins who asked, do you and Ali agree or disagree on politics? Do you discuss, debate or avoid the subject? And how do you explain those negative ads to your children?

Well, our house is mostly a politics-free zone, although the campaigns have given Ali plenty of fodder for her comedy. As for those negative ads, New York is not a battleground state, and my kids' TV is mostly the Disney Channel. But my 9-year-old Elliott (ph) did check out some of the debates, and she decided she'd be an excellent moderator.

That's all for us today. Thanks for sharing part of your Sunday with us. Check out "World News With David Muir" tonight and I'll see you tomorrow on "GMA."